Summary
- Saudi Arabia plans to invest $100 million in its aviation sector, aiming to develop world-class hubs and attract millions of passengers.
- Diversifying income sources is a key strategy for the Kingdom, with a focus on developing a lucrative tourism sector that will eventually account for 10% of the GDP.
- Saudi Arabia aims to have more than 250 destinations by 2030, optimizing airline operations and working toward their growth to support its larger vision.
Saudi Arabia’s larger plan of creating a bigger travel market received a significant push with its plan to invest $100 million in developing its aviation infrastructure. The Middle Eastern nation has been trying to diversify its revenue stream by gradually shifting to other sectors, and tourism features heavily as part of that plan.
$100 million investment
The Kingdom of Saudi Arabia is planning to inject $100 million into its aviation sector as part of its larger plan to develop world-class hubs in the country and attract hundreds of millions of passengers by the end of this decade.
Photo: Fedor Selivanov | Shutterstock
Abdulaziz Al-Duailej, the president of the Kingdom’s General Authority of Civil Aviation, spoke about this move at the 15th International Conference on Air Services Negotiations, organized by the ICAO in Riyadh on December 3. He explained that the investment would cover all major areas of the aviation sector, adding,
“We aim at developing and upgrading all aviation sectors, including Saudi airlines, logistics services, cargo services, and other support services … We are building an integrated airline network with Riyadh and Jeddah as strategic and central hubs.”
Diversifying income sources
Saudi Arabia has embarked on an extensive plan to gradually develop other income sources and not be reliant on oil alone. Developing a lucrative tourism sector is a major part of that plan, and the aim is that it will account for 10% of the Kingdom’s GDP by the end of this decade.
Photo: Riyadh Air
According to a report by Bloomberg, Saudi Arabia is also planning to open its domestic aviation industry to more competition with an overhaul of the aviation sector, which by 2030 could see up to $100 billion in investments.
The larger strategy also includes privatizing the ground-handling operations and incentivizing airports to improve their quality standards. Streamlining of licensing processes for cargo and ground-handling services will also be done. Al-Duailej commented in October,
“The regulations create an open, dynamic and competitive market, setting a level playing field for global operators and investors in the Kingdom.”
Huge plans
Saudi Arabia is aiming to have more than 250 destinations by 2030. It has developed the Air Connectivity Program (ACP), under which it will incentivize airlines to add several new routes and destinations to grow its passenger base.
To support its vision of creating world-class airport hubs in Riyadh and Jeddah, Saudi Arabia understands the importance of optimizing the operations of its airlines and working toward their growth. There are plans for SAUDIA to withdraw from King Khalid International Airport (Riyadh) to allow the new carrier Riyadh Air to establish its presence there.
Photo: RIK Miheyeu | Shutterstock
flynas To Be The Largest Low-Cost Carrier In The Middle East & North Africa By 2030
flynas expects to open a new base in 2023.
Then there’s the low-cost carrier flynas, which currently has a fleet of just over 50 aircraft but is aiming to become the largest budget carrier in the Middle East and North Africa by 2030 by adding an average of 16 planes annually. It’ll be interesting to see how Saudi Arabia’s substantial aviation ambitions take shape in the coming years.
What are your views on this? Please leave a comment below.
